S. 70(3) provides that the rights and things election under s. 70(2) is unavailable if the rights or things (the “Property”) have been distributed by the estate before the deadline for making the election has expired to beneficiaries or other persons beneficially interested in the estate. In the situation where the will bequeathed the Property to a testamentary trust, CRA considered that:
To the extent that the testamentary trust is, under applicable private law, a beneficiary of the estate at the time of the transfer or distribution of the Property by the estate, the testamentary trust could be considered a beneficiary or a person beneficially interested in the estate of the deceased individual for the purposes of subsection 70(3).